Joe Paduda of Managed Care Matters is (understandably) worried about Americans losing their health insurance due to Republicans' cuts to healthcare spending—but his arguments regarding the impact on workers’ comp insult all doctors who treat injured workers.

In a recent article, Paduda predicts that to offset losses from Republican healthcare cuts, doctors will target workers’ comp as the “softest target” and will:

• “jack up prices”
• Deliver medically unnecessary care
• “keep workers comp patients out of work as long as possible”
• Find ways to “hoover more dollars” from employers

Mr. Paduda's “predictions” run counter to the basic core principles of workers’ compensation.

Specifically, state fee schedules (not doctors) dictate doctors' fees, state treatment guidelines (not doctors) determine what care doctors provide to injured workers, and payers (not doctors) authorize or deny care, which determines how long workers remain out of work.

While workers’ comp involves egregious and enormous amounts of revenue “hoovering,” the greatest hoover of all is private equity, with its vertical consolidation of profitable administrative entities ultimately inflating employers’ workers’ comp costs more than providers ever could.

This attack on doctors comes from someone aligned with entities that have partnered with the private equity firms that profit from the dysfunction currently driving excessive workers’ comp costs.

Below, we further dismantle Mr. Paduda’s demonstrably dubious (and absurd) predictions.

Absurd Prediction #1: Doctors Will “Jack Up Prices”

Mr. Paduda claims that doctors will target workers’ comp and “jack up prices” to treat injured workers.

This prediction fundamentally misrepresents how workers’ comp reimbursement works. In most states, fee schedules set doctor reimbursement rates, while the Office of Workers' Compensation Programs (OWCP) determines reimbursement for federal claims.

Doctors don’t control these prices—governments do.

The real issue is that Preferred Provider Organizations (PPOs) drive doctors away from treating injured workers because these entities (often owned by private equity) devise schemes to undercut doctor’s reimbursements to rates substantially lower than the fee schedules.

Need proof? Take a look at our comprehensive reimbursement data.

The idea that providers can “jack up prices” misrepresents the realities of workers’ compensation reimbursement. The state or federal government usually dictates provider reimbursements—but claims administrators routinely pay doctors far less through PPOs and other schemes.

Absurd Prediction #2: Doctors Will Increase Volume of Services

Mr. Paduda claims that doctors will respond to healthcare revenue losses by increasing the volume of services they provide to injured workers.

This prediction also ignores how workers’ comp actually operates. Nearly every state enforces strict treatment guidelines, such as California’s Medical Treatment Utilization Schedule and Hearst Health’s Official Disability Guidelines.

The claims administrator can deny authorization if a doctor recommends treatment outside these guidelines. In California—the nation’s largest workers’ comp market—employers pay claims administrators to review all treatment, regardless of whether it aligns with the state’s guidelines.

Rather than rubber-stamping care, the cumbersome and costly Utilization Review (UR) system often delays or denies necessary treatment.

Ironically, if doctors—not private equity-owned UR firms—controlled medical decisions, injured workers would likely recover and return to work faster, necessitating fewer services overall.

Absurd Prediction #3: Providers Will Keep Injured Workers Out of Work

Mr. Paduda claims that greedy doctors will “keep workers’ comp patients out of work as long as possible.”

Really? No credible research supports the idea that doctors intentionally prolong injured workers’ claims. If anything, the real obstacles to returning injured workers to their jobs come from systemic dysfunction, not doctors.

In reality, extended disability is more often the result of:

• UR delaying necessary treatment
• Claims administrators disputing legitimate claims
• A broken system that leaves injured workers in limbo for months or even years

Blaming doctors for prolonged disability is a tired and baseless trope—one that distracts from the real reasons listed above that injured workers don’t return to work more quickly.

Absurd Prediction #4: Doctors Will “Hoover” Money From Payers

Finally, Mr. Paduda claims doctors will “constantly figure out ways to hoover more dollars out of work comp payers.”

While workers’ comp is rife with revenue “hoovering,” doctors are not the culprits—they’re among the victims.

Private equity is the real force siphoning employers’ workers’ comp dollars, which has vertically consolidated key players in the system to inflate costs at the expense of doctors, injured workers, and employers.

These consolidated entities include:

• Third-Party Administrators (TPAs)
• Bill review firms
• PPOs and other network discount entities
• Medical Provider Networks (MPNs) and “physician network service” entities
• Utilization Review Organizations (UROs)
• Credit card companies skimming fees from Virtual Credit Card (VCC) payments
• Pharmacy Benefit Managers (PBMs)

Rather than blaming doctors, Mr. Paduda should consider focusing on the billions of dollars these private equity-backed middlemen waste. The entities above (and their private equity backers) profit by inflating administrative costs—not by improving patient care or quickly returning injured workers to full employment.

Mr. Paduda rightly highlights concerns about the potential impact of the current administration’s approach to healthcare spending. However, his suggestion that doctors may respond to these cuts by exploiting workers' compensation programs appears speculative and is insulting to doctors.

In reality, doctors seeking financial stability are more likely to leave workers’ comp than exploit it—especially as private equity-backed middlemen continue “hoovering” employer dollars, driving up costs and making it harder for doctors to care for injured workers.

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